Dow Chemical Co. said its planned acquisition of Union Carbide Corp.
probably won't happen by Sept. 30 as expected as the company strives to appease antitrust
regulators.

The chemicals giant didn't set a new target date for closing, but repeated
that it remains confident the deal will be completed "in the near future."
Negotiations with the US Federal Trade commission have dragged out the planned $8.89
billion (10 billion pounds) stock transaction for more than a year after it was announced
Aug. 4 1999.

The repeated delays, coming on top of a change in management, have created more
uncertainty around Dow during a time when its shares are hitting new lows. Dow's stock has
lost more than 40% of its value since the beginning of the year, when it was trading in
the mid-40s. At midday Wednesday in New York Stock Exchange composite trading, the
company's shares were up 63 cents to $27.81.

The transaction received approval from European Commission antitrust authorities in May
after the companies agreed to sell some businesses and license some technology to
competitors.

Industry experts believe the biggest sticking point in FTC negotiations is over
concerns that a Dow-Carbide combination would create a plastics technology powerhouse that
could dominate the market. As in Europe, Dow has probably been asked to license its
technology to competitors. But Dow is renowned as a tough bargainer, and negotiating terms
that Dow executives can stomach is likely proving to be a difficult and delicate task, say
observers.

Despite the prolonged negotiations, analysts believe Dow has invested too much in the
merger to walk away; Dow has already named the new management team for the combined
companies. What Dow must wrestle with, says ING Barings analyst Paul Leming, is "How
much can you give up to get the deal done and still come out ahead of where you'd be if
you let the deal die?"